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The latest tech tools

You can save your business big money by checking out new web-based office and telephone software, and more.

By Jonathan Blum

May 4 2007: 12:15 PM EDT

(Fortune Small Business) -- Let us quickly review the technology set-up for the average small business: Make a quick trip to Staples, get a PC and call over to the phone company. But not so fast. These days, choice rules. New Web-based office and telephony tools and wireless data services are rocking the once-simple tech universe of the small business.

Granted, many of these tools can be a royal pain. Scary self-installations loom. Quality can be iffy. And you will definitely miss certain features. But, even as you read this, some of your competitors are doing business while paying nothing for phone service and next-to-nothing for computer software, and they certainly are not wasting precious time haggling with the phone or cable company.

Welcome to the strange new world of small-business technology. If you want to compete, get on board.

The non-phone

As tough as it is for our landline-driven phone generation to comprehend, your business may no longer need a traditional phone. Next-generation phones have lots of confusing descriptors: "softphones," "voice over internet telephony" or VoIP - ludicrously pronounced "voyeep." There's "voice over instant messaging" and "computer telephony" and more.

Sounds complicated. But what's most important to understand is that these "phones" are really nothing but bits of software that run on your computer. This software uses headphones and keyboards to capture your speech and phone numbers. That's translated into Internet traffic that can be distributed over the Web and onto a public phone network to make calls to and from any computer or phone in the world.

You'll need a two-connection headphone - that's a set of earmuffs and a microphone wired with two audio connectors, usually a pink one and a green one - as well as software, and a credit card.

The pricing is mind-boggling: Assuming you and your clients are running the same software - say, Skype for Business - phone calls are free. Zip. Nada. And flat-rate plans for North America to any phone cost $30 per year.

Quality can be an issue. I have made many calls where the sound is fine, but others are ghostly and hard to hear. And connections are spotty. But considering that even a basic traditional digital phone system can run $10,000 to buy and about the same per year to operate, softphones can save your business $20,000 in the first year alone.

There's no denying those economics.

Windows-less

You no longer have to buy Microsoft Windows Office to have software that works for your business. None other than Google has stepped up with a legitimate competitor - a complete small-business software package called Google Apps, currently in Google's "pre-release" phase. The full-featured edition is free until April 30, 2007.

Google Apps offers a word processor, spreadsheet, calendar, branded e-mail, and even a telephony application, among many other tools. While you may miss all the bells and whistles - no fancy Microsoft Mail Merge, for example - Google Apps definitely works.

The software is entirely browser-based, so your files live on Google's servers. No more back-up headaches. Though the idea of storing sensitive financial information on some other company's computer can make one a bit queasy.

Again, the pricing is spooky: The basic package is free. And the Premier edition, which includes more storage, features and support, runs $50 per year. By comparison, the latest riff of Microsoft Office is far from cheap. Upgrades start at $239 for basic packages and climb to $679 for full-featured primary licenses. And that ignores the new Windows Vista operating system and hardware needed to make Office 2007 work as it should. Factor those in and the costs could get well north of $1,100, if not higher. So assuming a 10-person office, that's nearly $10,000 you just did not spend.

Blind data

Sometime soon you will have a third choice beyond your cable and phone company for data and phone products - the emerging Worldwide Interoperability for Microwave Access, or WiMAX, provider.

Never mind the goofy Austin Powers-esque acronym, WiMAX is the real deal for small business. Essentially a gigantic WiFi hot spot, WiMAX providers offer data products by broadcasting and receiving digital information that rides on top of old-fashioned radio waves. All you need is a special antenna attached to a router. No pesky wires.

The release status of WiMax in North America is volatile at the moment, with providers carving out regional strongholds - sometimes seemingly by zip code - and pricing all over the map.

The following is a brief provider overview:

TowerStream. Founded in 2000, the company says it has established networks in New York, Los Angeles, Chicago, San Francisco, Seattle, the greater Boston area, Providence and Newport, R.I. A decent T1 line substitute, the company's pricing ranges from T1 Internet backup for $175/month to high-availability T1 for $600 a month.

Valtech Communications. Valtech, founded in 2003, is competing directly against Sprint in Ohio and offers basic phone and data access with dial-up service running $19.95 per month.

Clearwire. Founded in October 2003 by telecom veteran Craig O. McCaw, Clearwire says it offers service in 36 metro areas in California, Florida, Hawaii, Idaho and Minnesota. Probably the more friendly to small business of the bunch, it offers a direct competitive product to DSL and cable in some markets.

Sprint Nextel. Profit-hungry Sprint Nextel (Charts, Fortune 500) holds licenses covering most of the United States and says it plans to build a "Nationwide advanced wireless broadband network expected to cover 100 million people in 2008."

I am not saying WiMax will be the panacea for the small business. These are, after all, still telecom companies. But if you don't integrate these options into your business, you can bet someone else will - and that just may include your biggest competitor.